“The Impact of Land Price Marketization on Input and Technology Choices: Evidence from China's Industrial Sector”

Aidong Zhao, Nanjing Agricultural University

Jing Lan, Nanjing Agricultural University

Futian Qu, Nanjing Agricultural University

Xianlei Ma, Nanjing Agricultural University

Based on price-induced technological change theory, this paper examines the impact of land price marketization reform on input and technology choice in China’s industrial sector. we find that increasing relative price of industrial land is more likely to induce the short-term substitution of non-land factors with land and long-term industrial land-saving technological change in the developed eastern China, whereas the land price-induced effect is not present in the less-developed central and western China. Evidence from this study suggests that Chinese land price reform should be intensified by introducing a more market-oriented land price formation mechanism without interventions from governments.